GRA · Development Finance Nexus
Spatial financeWhere capital meets hazard, exposure and transition
Public investment and projects
Most infrastructure in developing economies is financed through the budget, public enterprises and sovereign borrowing, with development banks as lenders and advisers. Whether a project delivers depends largely on what happens before financing: identification, feasibility, appraisal, selection, procurement design, land and safeguards preparation. This page sets out how project risk develops through the preparation cycle, which records evidence it, and who decides at each gate.
Public investment and projects in seven parts.
- 01The questionPublic investment and projects: how the risk develops
- 02IndicatorsWhat is measured, and how well
- 03SourcesWhere the evidence comes from
- 04DecisionsWho decides, and what the evidence serves
- 05Core questionsWhat the industry asks
- 06MechanismsHow risk and finance interact
- 07Methods and evidenceHow the evidence is built, and its limits
Public investment and projects: how the risk develops.
Infrastructure preparation and risks. The dossier below sets out how the risk develops, what is measured, where the data come from, how it is modelled and who decides.
Optimism at appraisal
Cost estimates and demand forecasts made to secure approval tend to be optimistic. Reference class forecasting and independent review exist because the bias is systematic across sectors and countries, not accidental.
Preparation gaps become delays
Incomplete feasibility, design, land acquisition or resettlement planning delays the start of works while commitment fees and price escalation continue. Delay cascades into cost overruns, scope cuts and restructuring.
Procurement shapes risk transfer
Contract type decides who carries ground, design, price and schedule risk. Poorly packaged contracts, thin bidder fields and weak contract management move risk back to the public client through claims and variations.
Maintenance decides the return
An asset built but not maintained delivers less service over a shorter life. Maintenance competes with new projects in every budget round and usually loses, turning a stock of assets into a contingent liability.
Where projects sit, and which layer protects them.
Where development projects meet hazard and poverty, and which financing layer protects them. Hypothetical projects and design values.
What is measured, and how well.
Each indicator carries its unit, its cadence, the kind of source behind it and the evidence label a value would carry. No values are shown: a programme supplies them under its own authority.
| Indicator | Unit | Cadence | Source type | Label |
|---|---|---|---|---|
| Cost overrun at completion | percent of appraised cost | per project | MDB completion reports | Published statistics |
| Schedule slippage against appraisal | months | per project | MDB completion reports | Published statistics |
| Time from approval to first disbursement | months | per project | MDB operations data | Published statistics |
| Bidders per competitive tender | count | per tender | Procurement records in the Open Contracting Data Standard | Published statistics |
| Contracts with published award and contract data | percent of public contracts by value | annual | Open contracting publishers | REPORTED |
| Capital budget execution rate | percent of approved capital appropriation | annual | Budget execution reports | Published statistics |
| Outcome rating at completion | rating scale (highly unsatisfactory to highly satisfactory) | per project | Independent evaluation units | Published statistics |
| Maintenance allocation against asset base | percent of estimated asset replacement value | annual | Budget documents, asset registers | ESTIMATED |
Project pipeline and safeguards.
The screen a team would use to follow this subject: its measures, states and decisions. Names are examples and values are illustrative.
Project pipeline and safeguards
Public investment and projects · Country programme D · Pipeline review 3
Pipeline
| Irrigation rehabilitation | Food and water | Medium | Clear | Appraisal |
| Port expansion | Infrastructure | High | Finding | Preparation |
| SME credit line | Finance | Low | Clear | Board |
| Mini-grid programme | Energy | Low | Clear | Implementation |
Handoff
- Readiness dossier
- v2, reviewed
- Receiving institution
- development finance institution
- Decision
- theirs, not GRA's
- Record
- HO-967
Projects and hazard
red: high hazard exposure
Where the evidence comes from.
Named public datasets and institutional records, each with its licence class. Sources by agreement are used only under their terms and never republished.
| Source | What it gives | Licence class |
|---|---|---|
| World Bank Projects and Operations data | Approvals, financing, ratings and documents for each operation | CC BY 4.0 |
| Independent Evaluation Group project ratings (World Bank) | Validated outcome ratings from completion reports | CC BY 4.0 |
| Open Contracting Data Standard publications (Open Contracting Partnership data registry) | Tender, award, contract and implementation data published by governments | Open licence declared by each publisher |
| IMF Public Investment Management Assessment reports | Institutional ratings across planning, allocation and implementation | Public where published by the authorities, IMF terms |
| World Bank Benchmarking Infrastructure Development | Regulatory quality of PPP and public procurement of infrastructure across the project cycle | CC BY 4.0 |
| AfDB, ADB and IDB project portals | Disclosed appraisal, procurement and completion documents | Public under each bank's disclosure policy |
| National public investment registers and audit reports | Pipeline status, appraisal documents and audit findings | Public records, terms per government |
Trace a shock in public investment and projects to the balance sheet.
Assembled from the Nexus Standards area profile Disaster and climate risk finance: the shocks it names, the systems and sectors that carry the loss, the controls that dampen it and the data that observe it. Pick an initiating shock and step through the cascade to see which exposures it reaches and where losses could concentrate. The Map view places the run on an example geography with open data. Every weight is a stated assumption. An exercise, not a forecast, a valuation, a rating or investment advice. To model a place of your own choosing, open the full System Builder.
Hazards
- Tropical cyclone
- Earthquake
- Ice-jam flood
- Storm surge (set off downstream)
- Intense rainfall (set off downstream)
- River flood (set off downstream)
- Flash flood (set off downstream)
- Dangerous surf (set off downstream)
- Widespread power outage (set off downstream)
- Mass displacement (set off downstream)
- Coastal flood (set off downstream)
- Aftershock sequence (set off downstream)
- Fault surface rupture (set off downstream)
- Soil liquefaction (set off downstream)
- Slope slide (set off downstream)
- Rockfall (set off downstream)
- Tsunami (set off downstream)
- Building collapse (set off downstream)
Systems and couplings
Controls
NS-0Constitution and principlesNS-3Risk record UNIs (grammar, legacy crosswalk, allocation authority)NS-9Contextual UNIs (deployments, instances, programme instances)NS-10Policies and clauses (machine-readable obligations: definition, binding, evaluation and enforcement)NS-11Verification and monitoring (evidence, attestations, zero-trust conformance observation)NS-14Conformance and crosswalk to external standardsNRS-F8Parametric and index-based risk transferNRS-F7Disaster risk finance and pre-arranged financeNRS-H113Hazard family: Financial-system fragility (NHS-1 soc.financial-system)NRS-H114Hazard family: Macroeconomic and fiscal shocks (NHS-1 soc.macro-fiscal)NRS-D1Risk-informed development and project screeningNRS-H28Hazard family: Climate-state shifts (NHS-1 eco.climate-state)
Observation
- ERA5 reanalysis (Copernicus Climate Data Store) (listed for reference)
- CHIRPS quasi-global gridded precipitation (listed for reference)
- USGS earthquake GeoJSON summary feeds (listed for reference)
- Total public international support for national disaster risk reduction actions (Sendai indicator F-1)
- Direct economic loss attributed to disasters in relation to global GDP
Example geography
- Western Europe: 152 hexagonal cells
- Rain rate, last half hour (IMERG), NASA GIBS
- Night lights tonight, outages (VIIRS Day/Night Band), NASA GIBS
- Surface water through cloud, 30 m (OPERA DSWx-S1 radar), NASA GIBS
- Surface soil moisture (SMAP), NASA GIBS
Who decides, and what the evidence serves.
Development Finance Nexus prepares evidence. The decisions below are taken by the authorities named, under their own rules, and never by the platform.
| Who decides | The question | Evidence this page serves |
|---|---|---|
| Finance ministries and public investment units | Whether a project is ready to enter the budget or the borrowing programme | Feasibility, appraisal and safeguards evidence by gate; reference class ranges for cost and time |
| MDB management and boards of executive directors | Whether to approve a loan and with which conditions of effectiveness | Preparation status, procurement plan, safeguard instruments, implementation capacity |
| Line ministries and implementing agencies | How to package contracts and allocate ground, design and price risk | Procurement records for comparable contracts, bidder fields, claims history |
| Supreme audit institutions | Whether completed projects delivered what was appraised | Completion ratings, cost and schedule against appraisal |
Outputs this topic produces
- Preparation profiles showing which gates are evidenced and which remain open
- Reference class comparisons of cost and schedule from completed operations, with sources
- Procurement evidence drawn from open contracting data
- Question sets for appraisal and selection review
What public investment and projects means for exposure, loss and capital.
The exposure, loss, scenario and capital views a risk officer, supervisor or ministry of finance would ask for, with the frameworks they report against. Structures follow supervisory and actuarial practice. Values are illustrative: never prices, ratings or advice.
Transmission channels
How a shock in public investment and projects reaches credit, market, underwriting, liquidity and operational risk, and feeds back.
What the industry asks.
Public investment can raise growth and welfare, but its returns depend on management. Projects chosen for political rather than economic reasons, designs that ignore hazards, cost overruns and poor maintenance all reduce value. As climate change alters hazards over the life of assets, decisions made today determine exposure for decades. Strengthening public investment management is therefore a resilience measure in its own right.
- How are projects selected, and is the choice informed by appraisal of costs, benefits and risks?
- Do designs account for current and future hazards over the full life of the asset?
- How are construction, cost and schedule risks managed and shared between public and private parties?
- Is maintenance funded, so that assets keep delivering services and resist shocks?
How risk and finance interact.
Project outcomes are shaped at every stage of the investment cycle.
Appraisal and prioritisation
Cost-benefit and multi-criteria appraisal help choose projects that deliver most value. Weak appraisal is a common source of poor outcomes.
Resilient engineering
Siting, standards and design choices determine exposure to floods, heat and other hazards. Engineering science: Critical Infrastructure.
Maintenance and management
Underfunded maintenance shortens asset life and raises vulnerability to shocks.
Research on public investment efficiency finds substantial differences between countries in how much value they obtain from each unit spent, and attributes much of the difference to institutions: planning, appraisal, procurement, budgeting and maintenance. Resilience fits naturally into this framework, because the same institutions decide whether hazards are considered and whether assets are kept in good condition.
How the evidence is built, and its limits.
- 01
Public investment management assessment
Established diagnostic frameworks assess institutions across the investment cycle. Results describe systems, not individual projects.
- 02
Cost-benefit analysis
Economic appraisal using economics and development economics, including resilience benefits. Valuing avoided losses requires assumptions about hazard probability.
- 03
Hazard screening
Screening of project sites against hazard data, using geospatial information systems. Data resolution and future climate uncertainty limit precision.
- 04
Ex post evaluation
Evaluation of completed projects, using causal inference and impact evaluation where feasible. Evaluations are often delayed and not always published.
How it is studied, and what the methods cannot say.
- 01Economics and development economicsEconomic appraisal of a project · Debt sustainability context · Tariff and subsidy incidenceApplied here
- 02Decision analysis under uncertaintyRobust choice of design standard · Multi-criteria pipeline screeningApplied here
- 03Geospatial information systemsSafeguard screening of a project footprint · Physical climate exposure of assetsApplied here
- 04Causal inference and impact evaluationEvaluating a credit line or guarantee · Infrastructure impact on householdsApplied here
Questions and answers.
Why are cost overruns so common?
What is project preparation finance?
Does Development Finance Nexus appraise projects?
Does resilient design cost more?
Why is maintenance a resilience issue?
Does GRA appraise projects?
What is a public investment management assessment?
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